Personal Finance Final 2023

Which of the following is an effective strategy for personal saving?

• Save a certain percentage of each paycheck and deposit it directly into a savings account
• Wait until the end of the month and save whatever is left in your checking account
• Cover all of your wants and needs and save whatever is left over
• Take out a payday loan so you can save before you receive your paycheck

All of the following statements about bank accounts are true EXCEPT…

• Historically, savings accounts earn higher returns than investments in the stock market
• Money in a checking account is usually easy to access via ATM, debit card or check
• Many banks pay interest on the money you deposit into your savings account
• If the bank is FDIC-insured, your money, up to the FDIC limit, is safe even if the bank fails

Fill in the blanks with the correct responses. If you follow the 50-30-20 rule of budgeting, you'll be putting 50% of your monthly income toward _______________, 30% of your monthly income toward _____________, and 20% of your monthly income toward ______________.

• Needs, wants, savings
• Savings, needs, wants
• Needs, savings, wants
• Wants, needs, savings

Which of the following statements is TRUE?

• The majority of Americans do NOT have an adequate emergency fund or sufficient amounts of money saved for retirement
• The majority of Americans have an adequate emergency fund, but do NOT have sufficient amounts of money saved for retirement
• The majority of Americans have sufficient amounts of money saved for retirement
• The majority of Americans have an adequate emergency fund

Fill in the blanks: If inflation is _____________ your savings account interest rate then you will be ______________ purchasing power.

• Higher than, losing
• Higher than, gaining
• Equal to, gaining
• Lower than, losing

Which of the following transactions will REDUCE your checking account balance immediately?

• Using your debit card to pay for groceries at the supermarket
• Writing your monthly rent check which you will mail tomorrow
• Using your credit card to pay for your school books
• Depositing a check at a local bank branch

How often do customers typically receive a bank statement for their checking account?

• Monthly
• Annually
• Weekly
• Daily

Fill in the blanks: Direct deposit typically refers to your ______ sending your ______ electronically to your bank account.

• employer, paycheck
• employer, bills
• parents, allowance
• state government, taxes

FDIC Insurance is...

• Protection for bank customers’ deposits up to $250,000, guaranteeing their money is still available if the bank goes out of business
• Required if you want to do online or mobile banking
• Insurance bank branches can buy to protect their business against fraud and scams
• Optional coverage consumers can purchase so that their bank deposits remain safe

Which of the following statements is an advantage of online banking?

• Using online banking, you can request transfers, pay bills and automate your savings without visiting the bank branch
• You can only shop online if your bank account has online banking features
• Using online banking allows you to earn a higher interest rate
• Once you set up online banking, your bank will waive overdraft, ATM, and monthly fees